Amazon DSP Ads Vs Sponsored Display: Which Works Best For Your FBA Business?

Choosing the right types of ads is key in creating a solid marketing strategy for your Amazon FBA business. And the e-commerce giant certainly gives sellers a lot of choices, from Amazon DSP Ads to Sponsored Display Ads.

Marketing and advertising is definitely its own ball game in the world of e-commerce. By setting up ads through Amazon, businesses can boost their brand on not only the Amazon marketplace but on streaming services, ebook readers, publishing partners, other third-party platforms and more. With this type of advertising comes a lot of money and time (which we'll get into later). 

And, given the high investment needed for your advertising budget, you’ll want to do it right.

As an FBA seller on Amazon, you are the advertiser. And as the advertiser, Amazon gives you a choice of positioning options for your product ads so that you can work out the best options for your marketing strategy. But you first have to figure out how (and if) you qualify, the costs of the ads, and where you want the display ads to go. 

This blog post highlights the different types of Amazon DSP ads vs Sponsored Display ads on the e-commerce platform, and how to know which type of ad will work best to boost your sales and business. And to help you curate your next winning ad strategy, we'll go through everything FBA sellers need to know so you can best optimize your Amazon ads for the coming year. 

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What Are Amazon DSP Ads?

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Confused by the types of Amazon DSP ads versus sponsored display? We got you. 

Amazon DSP ads means Demand-Side Platform advertising. According to Amazon's website, a demand-side platform is software that provides automated, centralized media buying from multiple sources. Unlike Sponsored Display, Amazon DSP ads can be seen outside of Amazon’s website (even Google Ads). 

In practice, DSP is a type of online advertising run by Amazon that can be used by both Amazon FBA sellers as well as businesses that do not sell products directly on Amazon’s marketplace. This is one of the main differences between these two types of ads. 

And why would an entrepreneur want to set up Amazon ads in the first place if they are not even selling on Amazon? For the most part, it is to reach Amazon's massive audience. As we've noted in the past on this blog, Amazon is one of the biggest companies in the world, ranking in billions in gross annual revenue. 

Amazon DSP ads can come in the form of screen display ads, audio, as well as video ads.

There's also so many benefits to investing in Amazon's DSP ads, including boosting brand awareness and finding your perfect customers.

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What Are Amazon's Sponsored Display Ads?

While other types of Amazon PPC ads such as Sponsored Product and Sponsored Brand work specifically on Amazon's website, sellers can optimize Amazon Sponsored Display Ads to target a wider audience on and off Amazon. These are Amazon's latest types of ads that Amazon FBA sellers like yourself can invest in to circulate online, beyond the Amazon marketplace. 

There's no minimum daily ad spend for Sponsored Display ads, and their main objective is to find your buyers based on their buying practices and interests. All ad clicks will bring potential buyers directly to your Amazon store.

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How Do I Start Advertising on Amazon?

When you finally get down to planning your online marketing and advertising strategy, there are some major aspects to consider.

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Important things to keep in mind when planning your ad strategy with Amazon:

• Are you eligible?
• Types of advertising and their related costs (DSP vs Sponsored Display)
• Creative control over the ads

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Now, we’ll go over these points in more detail so that you can discover the best plan of action for your own advertising strategy on Amazon.

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Eligibility

To run Amazon's Sponsored Display Ads, you need to be signed up for their Brand Registry Program first. 

Eligible Amazon FBA sellers as well as some e-commerce entrepreneurs selling outside of Amazon can sign up to run DSP ads through Amazon. You will need the right budget and some foolproof planning. To check the full eligibility criteria to use Amazon DSP ads, you can reach out to an Amazon Ads account executive.

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Creative Control Over the Types Of Amazon Advertising

Another major difference between Amazon DSP ads and Sponsored Display is that Amazon DSP ads work by programmed, managed-service options as well as self-service options by the advertiser. Amazon FBA sellers have complete control over the management of their Sponsored Display ads, which Amazon calls its self-service option. You can customize your ads based on market research and any other way you see fit to target customers to your Amazon store.

With Amazon DSP ads however, businesses also have the option to use Amazon's own creative options to manage their advertising. If you go into the DSP ads game on Amazon, you can sign up for programmatic advertising, which is an automated buying and selling of digital space for advertisements (display, audio, video) on a website. 

But to qualify for Amazon's managed-service option for your DSP ads, you'll need an approximate minimum ad spend of $50,000, which brings us to our next point of advertising costs.

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How do Amazon DSP and Sponsored Display Compare in Cost?

The Sponsored Display PPC ad structures versus the unique DSP cost structure will vary in budget and ad outlook. As a successful entrepreneur, you should carefully measure the different costs of each type of ad so that you can effectively manage your marketing spend, and know which types of ad(s) work best for your business.

Here's the main difference between Amazon DSP and Sponsored display ads when it comes to costs: DSP ads go by Cost-per-mile (CPM) and Sponsored Display ads are by Price-per-click (PPC, as we all know it). 

CPM (cost-per-mile): The average cost that advertisers pay to get 1,000 impressions on their ads. 

PPC (pay-per-click): The average cost that an advertiser (you) is charged when someone clicks on your ad, regardless of whether the item is purchased or not. 

FBA sellers are not subject to any minimum daily budget for Sponsored Display ads, and as we previously mentioned, the minimum ad spend for Amazon's managed-service option with DSP ads is around $50,000. The minimum budget does depend on which country you are selling from, so check Amazon's guidance for the latest info.

One of the best ways to strategize which type of Amazon ad will work best for you is to calculate your conversion rates. It's also essential that your ad strategy aligns with your goals (do you want brand awareness or more hits to your store?) so that you'll know the best type of ads to help boost your business going forward into 2023.

Want to boost your conversion rates? Our Amazon experts at Mayan share their top tips in this post. 

If you choose to go with one of these types of Amazon ads to boost your business, know that the goals for DSP ads and Sponsored Display ads are very similar: both of these types of ads go beyond the on-page advertising and targets users based on their buying habits and interests. The algorithm is essentially more advanced than other types of Amazon ads used in the past. 

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How Can Mayan Help Your FBA Business?